Correlation Between Multimanager Lifestyle and Ing Intermediate
Can any of the company-specific risk be diversified away by investing in both Multimanager Lifestyle and Ing Intermediate at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Multimanager Lifestyle and Ing Intermediate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Multimanager Lifestyle Aggressive and Ing Intermediate Bond, you can compare the effects of market volatilities on Multimanager Lifestyle and Ing Intermediate and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Multimanager Lifestyle with a short position of Ing Intermediate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multimanager Lifestyle and Ing Intermediate.
Diversification Opportunities for Multimanager Lifestyle and Ing Intermediate
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Multimanager and Ing is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Multimanager Lifestyle Aggress and Ing Intermediate Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ing Intermediate Bond and Multimanager Lifestyle is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Multimanager Lifestyle Aggressive are associated (or correlated) with Ing Intermediate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ing Intermediate Bond has no effect on the direction of Multimanager Lifestyle i.e., Multimanager Lifestyle and Ing Intermediate go up and down completely randomly.
Pair Corralation between Multimanager Lifestyle and Ing Intermediate
Assuming the 90 days horizon Multimanager Lifestyle Aggressive is expected to generate 2.22 times more return on investment than Ing Intermediate. However, Multimanager Lifestyle is 2.22 times more volatile than Ing Intermediate Bond. It trades about 0.08 of its potential returns per unit of risk. Ing Intermediate Bond is currently generating about 0.06 per unit of risk. If you would invest 1,209 in Multimanager Lifestyle Aggressive on September 2, 2024 and sell it today you would earn a total of 329.00 from holding Multimanager Lifestyle Aggressive or generate 27.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Multimanager Lifestyle Aggress vs. Ing Intermediate Bond
Performance |
| Timeline |
| Multimanager Lifestyle |
| Ing Intermediate Bond |
Multimanager Lifestyle and Ing Intermediate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multimanager Lifestyle and Ing Intermediate
The main advantage of trading using opposite Multimanager Lifestyle and Ing Intermediate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multimanager Lifestyle position performs unexpectedly, Ing Intermediate can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Ing Intermediate will offset losses from the drop in Ing Intermediate's long position.| Multimanager Lifestyle vs. Franklin Gold Precious | Multimanager Lifestyle vs. Global Gold Fund | Multimanager Lifestyle vs. Europac Gold Fund | Multimanager Lifestyle vs. Goldman Sachs Clean |
| Ing Intermediate vs. Artisan High Income | Ing Intermediate vs. Pace High Yield | Ing Intermediate vs. California High Yield Municipal | Ing Intermediate vs. Siit High Yield |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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